Utility Reselling

Utility Reselling is a practice used by landlords, manufactured home park operators and condominium associations to pass utility costs on to their tenants, residents or members.

Utility resellers purchase gas, water/sewer, and electric service from regulated public utilities and then resell them often at a mark up of rates and an administrative fee, sometimes without actual meter readings and none of the consumer protections that exist for public utilities.

Dan Gearino of the Columbus Dispatch reports: "After years of inaction, Ohio lawmakers say they are eager to pass new rules to regulate companies that resell utilities in apartments and condominiums. Two are bills being considered, and one of them — House Bill 249 — got its first hearing on Tuesday as legislators returned from their summer break. 'The question we must try to answer is this: Should Ohioans, living in apartments or condominiums, generally be entitled to the same consumer protections the legislature affords single-family homeowners?' asked the bill’s sponsor, Rep. Mike Duffey, R-Worthington. The bill would regulate so-called submeter companies, which act as intermediaries between regulated utility companies and end users. Some submeter companies charge markups on electricity and water, along with other fees, leading to higher bills than customers would otherwise pay." posted September 13, 2017

March 17, 2017 Columbus Dispatch,Submeter firms could face regulation by cityDan Gearino at the Columbus Dispatch reports: "Years of inaction by the state may push the Columbus city government to set limits on companies that resell utilities in apartments and condominiums. That was the conclusion of Mike Stinziano, a council member, following the public hearing he convened Thursday to gather comments on the topic. 'Having it all on the record is important to then further the discussion,' Stinziano said about the hearing, which lasted about an hour and a half. 'It has been a real education about why this is important.' "

February 19, 2017

Columbus Downtown Tenants take on Utility Reselling

Dan Gearino of the Columbus Dispatch reports: "Downtown residents among latest activists in fight against submetering's costs. The people gathered in this living room could have talked for hours about why it is great to live Downtown. But they ended up focusing on one big reason Downtown living can be lousy: high utility bills from submeter companies. ' We can't in good conscience say 'come Downtown' and then put them into these submetered places where they just get hammered,' said Rick Colby, a board member of the Downtown Residents' Association of Columbus. 'It's very much an economic-development issue.' "

Columbus Dispatch reports: "Ohio utility regulators ruled Wednesday that submeter companies can charge no more than households would pay to their local regulated utility. The unanimous decision by the Public Utilities Commission of Ohio affects the previously unregulated companies that resell electricity and water in apartments and condominiums. Among the details:

* Billing fees would no longer be allowed if the fees lead to a total bill that is more than a customer would pay to the regulated utility.

* Common-area charges, such as for hallway lighting, would continue to be allowed on bills, but without a markup. These charges would not count in the comparison with regulated bills.

* Consumers who think they are being overcharged can contact the PUCO call center, 1-800-686-7826, for help determining whether a submeter company is violating terms of the ruling.

* If the PUCO finds that a submeter company is violating the terms of the ruling, the penalties could be severe, including a potential order that the company transfer the affected housing complex to be served by the regulated utility.

* The ruling only applies to residential customers, not businesses."

posted June 22, 2017

June 11, 2017 Utility Reselling legislation--the good and bad bills in House and Senate.

At the Ohio Poverty Law Center's Housing Task Force, Mike Smalz (retiring at the end of June) reported on two new bills to address the practice of utility reselling in Ohio.

Senator Bacon's bill (SB 157) and Rep. Duffey's bill (HB 249) both offer really different approaches to the problem. Dispatch reporter Dan Gearino profiles the two bills in his article "Efforts begin anew to regulate submeter companies, with pair of bills introduced." In contrast to RHINO's previous story, in this case the Dispatch has editorially commented on the need for a legislative solution. "Residents are still at their mercy. They have no recourse but to pay the inflated utility bills or move. Absent regulation, there is nothing to prevent this practice from spreading statewide, potentially affecting many more of the state’s 3 million renters." Having a prize winning reporter, who is committed to the issue, makes a difference at the editorial level.

It will be an uphill fight against some entrenched interests at the State Capital to get a bill that addresses the needs of renters, manufactured park and condo residents. RHINO is reaching out to advocates around Ohio to take advantage of the summer recess to develop strategies to address these initiatives in a coordinated fashion. Documenting utility abuses outside the I-270 beltway will be necessary to offset the concentration of corporate power at the State House. RHINO member VeraH has already been in touch with Rep.Duffy. Thanks to JoeM for agreeing to help with the "inside game" around this issue.March 14, 2017 Ars Technica Switching apartment metering shocks electricity freeloaders into conservation “Utilities included” is not a good deal."The data they collected helped to illuminate a somewhat murky question about how people respond to economic incentives. Elinder and his colleagues found that most people didn’t actually change their behavior much, but the top 20 percent of electricity hogs reduced their consumption so much that the total electricity usage across the buildings dropped by 24 percent. The implication is that when electricity was included in rent, the cost of these freeloaders was invisible to them. Once they had to pay for power themselves, it was good for the planet—and for everyone else’s pockets."

PUCO to Utility Resellers-Let's regulate your gouging!

Dispatch reports "Price gouging is no longer allowed by companies that resell utilities in apartments and condominiums, according to a long-awaited ruling from Ohio utility regulators." But wait...there's a couple things that have to happen before you can file a complaint. "The next task is to determine what constitutes gouging, a process that officials will begin next month." This ruling and the re-introdution of Rep. Duffey's bill in the Ohio House are two items on the agenda when the Ohio Poverty Law Center meets this coming week. More news to follow.

December 4, 2016 Suppose they held a hearing and nobody came That almost happened with Utility Reselling this week when House Sponsor Duffey held a "sponsor testimony" hearing on his bill that would regulate landlords who make a profit on tenants/condo owners utility bills. Dan Gearino reports for the Columbus Dispatch: "A hearing on one of those plans, sponsored by Rep. Mike Duffey, R-Worthington, occurred Wednesday, but there are no plans to hold a vote. 'The fundamental question we must answer is this: Should Ohioans who live in apartments, condominiums or other properties served by a submetering company operating as a utility reseller be entitled to the same consumer protections the legislature already provides to residents in single-family homes and apartments who receive service from a public utility?'

Rep Duffey asked, speaking to the House Public Utilities Committee."Duffey was the only person to speak at the hearing, which he said was held at his request. He wanted to call attention to his plan, House Bill 589, even though he knows that no action is planned on it.

November 4, 2016 Columbus Dispatch Hurry up and wait....

Earlier this week, RHINO learned that the Public Utilities Commission of Ohio (PUCO) was ready to make an announcement about its utility reselling investigation. And they did! The announcement was: not ready to make an announcement. According to the Columbus Dispatch: "Ohio utility regulators said Thursday that they need more time to issue findings in an investigation of 'submeter' companies."

In response to the delay, the Dispatch quoted Ohio House member Mike Duffey as saying: " ' I think the only thing the PUCO has done is repeatedly delay action on submetering....Let's hope (the) delay indicates a more aggressive stance will be taken by commissioners. But they should not wait long, or the public will think they are the problem as much as the submetering companies '."

Rep Duffey has submitted a bill in the Ohio State House that would address many of the concerns raised by housing and consumer advocates about the practice.

Hurry up and wait....

Earlier this week, RHINO learned that the Public Utilities Commission of Ohio (PUCO) was ready to make an announcement about its utility reselling investigation. And they did! The announcement was: not ready to make an announcement. According to the Columbus Dispatch: "Ohio utility regulators said Thursday that they need more time to issue findings in an investigation of 'submeter' companies."

In response to the delay, the Dispatch quoted Ohio House member Mike Duffey as saying: " ' I think the only thing the PUCO has done is repeatedly delay action on submetering....Let's hope (the) delay indicates a more aggressive stance will be taken by commissioners. But they should not wait long, or the public will think they are the problem as much as the submetering companies '."

Rep Duffey has submitted a bill in the Ohio State House that would address many of the concerns raised by housing and consumer advocates about the practice.

"The industry and landlords who profit from the business arrangement naturally oppose such regulation. Hands off, they say, arguing that submetering offsets landlords’ utility technology costs and encourages residents to conserve energy, because they get individual meters. If submeter companies truly provide a needed service, a level playing field of regulation won’t kill them. But for years now, utility resellers have derailed every effort at the Statehouse toward legislative regulation. The lobbyists apparently are now turning their high beams on the PUCO to stall regulatory reform."

Columbus Dispatch reports that NEP doesn't want to have PUCO hearings on the issue of utility reselling. "The case, opened last year by the PUCO, is an investigation into whether the panel has the authority to regulate companies that resell utilities in apartments and condominiums. Many participants filed written testimony, most recently in February. The next step is a ruling by the PUCO. Consumer advocates such as the Office of the Ohio Consumers' Counsel said this month that the panel should hold a hearing so that the record includes testimony from more people who are directly affected by utility reselling, a practice in which some companies charge consumers considerably more than they pay. Some advocates have raised concerns that the PUCO is taking too long to make a decision."

September 14, 2016 PUCO urged to hold hearings on utility resellingThe Columbus Dispatch reports on efforts by housing and consumer advocates to get the Public Utilities Commission of Ohio to hold hearings on utility reselling. Following a PUCO request for written testimony, the regulator went silent on the issue. The Dispatch reports: “ 'The customers whose protection is the subject of this case should be given the opportunity to be directly heard by their government, here the PUCO,' said the filing made Tuesday, submitted by the Office of the Ohio Consumers’ Counsel, the Ohio Poverty Law Center and attorney Mark Whitt. Whitt helped to inspire the case last year when he filed a formal complaint with the PUCO about utility billing in his Arena District condominium. The commission voted to pause consideration of that case and open a broader investigation of submetering. Also, Whitt is one of the attorneys who filed a proposed class-action lawsuit against a submeter company, Nationwide Energy Partners, in Franklin County Common Pleas Court."

August 25, 2016 Two utility reselling bills in the General Assembly

In a summary of the new bills, Dan Gearino writes in the Dispatch "A second proposal has emerged that would regulate "submeter" companies, one that the companies like a lot better than the first plan." Senator Kevin Bacon introduced Senate Bill 348 Last week Rep Mike Duffey, who forged a coalition bill out of three disparate proposals last year, offered a different proposal House Bill 348. "The Duffey plan says a submeter company can charge no more than the regulated prices of utilities, and directs the Public Utilities Commission of Ohio to set rules." In contrast, according to Gearino, Senate Bill 348 would "...increases disclosure for consumers and sets out a complaint process. It says landlords and submeter companies must select one of four methods of setting utility rates. Depending on the method, the outcome could be rates that are higher or lower than those charged by regulated utilities.In Gearino's article, American Power & Light is quoted as attacking Duffy's bill and praised Bacon's effort as "better for consumers." HINT When a utility provider tells you that legislation is better for consumers, put your hand on your wallet.No action is expected this year. Senator Bacon told the Dispatch " 'It really is a starting point," he said. "I don't know where this is going to end.' " Still it is important that the issue will be "on the agenda" when newly elected General Assembly convenes in 2017.

April 3, 2016 Dispatch features two stories on utility reselling

One is a profile of Mark Whitt, a crusading Columbus attorney who triggered a PUCO investigation of utility resellling and is heading up a class action law suit against Nationwide Energy Partners, his own personal utility provider. The second article recaps the futile effort of the Ohio General Assembly to address utility reselling in legislation in 2014. Here's the best indicator that owners are seeing utilities as another profit center in an era of rising rents According to the Dispatch utility reselling jumped 50% in AEP service area in just three years. "Right now, about 30,000 households in AEP Ohio territory are served by these types of submeter businesses, according to AEP. That is a leap from 2013, when the number of households was roughly 20,000, indicating that submeter companies are serving many newly built apartments and condominiums.April 3, 2016, Columbus Dispatch, Utilities attorney taking on ‘submeter’ companies after using service

April 3, 2016, Columbus Dispatch, Legislation to help Ohio ‘submeter’ consumers undermined by business interestsJanuary 23, 2016For once the big energy companies are on "our" sideColumbus Dispatch (Dan Gearino) reports "Consumers face 'substantial harm' from unfair and unregulated charges from companies that resell utilities, a situation that calls for a ban on the practices, according to joint testimony from two of the country's largest utilities. American Electric Power and Duke Energy say utility regulators should be much more aggressive on this issue. At the same 'time, trade groups for property owners and the resellers themselves are asking for a hands-off approach. 'Today, a landlord or submetering company can change rates over time in a manner that is erratic, volatile, and unfair to consumers -- all with impunity,' AEP and Duke said in a filing." Gearino continues: " In a new filing, the Office of the Ohio Consumers' Counsel and the Ohio Poverty Law Center say that new rules would 'profoundly benefit' consumers."

1/8/16 Class action suit filed against NEP. Columbus Dispatch reports "The lawsuit, filed in Franklin County Common Pleas Court, says the company is violating Ohio’s Consumer Sales Practices Act. It is a proposed class action, which means that a judge would have to approve the plaintiffs acting on behalf of all affected consumers. The new case does not change anything in the still-active PUCO case. What are the issues for tenants, MHP residents and Condo residents?

administrative fees

marked up rates

no consumer protections from loss of service, PIPP eligibility, reasonable late charges, unfair business practices,